Howmet Aerospace Inc.

Good morning and welcome to the HALMET Aerospace fourth quarter and full year 2024 conference call. All participants will be in listen-only mode. Should you need assistance, please signal conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one in your telephone keypad. To withdraw a question, please press star then two. We ask that you limit yourself to one question. Please note this event is being recorded. I would now like to turn the conference over to Paul Luther, VP of Investor Relations. Please go ahead.

Thank you, Anthony. Good morning and welcome to the Hamad Aerospace fourth quarter and full year 2024 results conference call. I'm joined by John Plant, Executive Chairman and Chief Executive Officer, and Ken Giacobi, Executive Vice President and Chief Financial Officer. After comments by John and Ken, we will have a question and answer session. I would like to remind you that today's discussion will contain forward-looking statements relating to future events and expectations. You can find factors that could cause the company's actual results to differ materially from these projections listed in today's presentation and earnings press release and in our most recent SEC filings. In today's presentation, references to EBITDA, operating income, and EPS mean adjusted EBITDA excluding special items, adjusted operating income excluding special items, and adjusted EPS excluding special items. These measures are among the non-GAAP financial measures that we've included in our discussion. Reconciliations to the most directly comparable GAAP financial measures can be found in today's press release and in the appendix in today's presentation. With that, I'd like to turn the call over to John.

Thanks, BT, and welcome, everybody, to today's call. Let's move to slide four, and I'll begin commentary on our fourth quarter. We closed out 2024 with healthy results. which exceeded the high end of our guide. Revenue is a record, as was EBITDA, EBITDA margin, and earnings per share. Fourth quarter earnings per share were 74 cents, an increase of 40% over the prior year, and that concludes the year at $2.69, and a good year, as we put it. For the full year, this represents a 46% increase year over year, and is 25% higher than our initial guide for 2024. Operating margin for the quarter was 23%. Free cash flow for the year was also a record at $977 million, representing an 88% conversion of net income. Average free cash flow conversion of net income over the last five years has been approximately 100%. Of the $977 million of free cash flow generated in the year, All was deployed to share repurchases, debt reduction, and dividends. During 2024, Hammett repurchased $500 million of common stock, of which $190 million was completed in Q4. Hammett also reduced debt by $365 million and paid $109 million in dividends. Regarding dividends, we recently announced a 25% increase in the quarterly common stock dividend, which will be paid later. this month. The balance sheet continues to strengthen with leverage of net debt to EBITDA improving to 1.4 times. Ken will now provide additional color regarding end market revenues in the quarter and year before moving to segment results. The one segment I'll highlight is the improvement in profitability of the structure segment since it showed the largest quarterly increase. This was clearly welcome and helps with our confidence moving into 2025. The commentary regarding outlook will be provided later after Ken's comments.